Chile's government has introduced sweeping tax reforms to Congress, including corporate tax cuts from 27% to 23%, the elimination of capital gains tax on listed securities, and a voluntary foreign asset disclosure program, as part of efforts to revitalise the economy and attract investment.
The Chilean government has introduced a comprehensive tax reform draft bill before Congress aimed at reviving economic growth, attracting investment, and creating formal employment opportunities across the country.
The draft legislation, presented to the Chamber of Deputies on 22 April 2026 as Bulletin No. 18216-03, proposes significant changes to the country’s tax framework with measures targeting both businesses and individual taxpayers.
Corporate tax cuts and system integration
Under the proposal, the corporate income tax rate for large companies will be progressively reduced from the current 27% to 25.5% in 2027, 24% in 2028, and 23% from 2029 onwards. Small and medium-sized enterprises (SMEs) under the Pro Pyme regime will see their rate drop directly to 23% by tax year 2029, replacing the previously planned 25% rate.
A major structural change involves reinstating full tax system integration from 2029. This will allow corporate income taxes paid to be fully credited against shareholders’ individual income tax liability, eliminating economic double taxation. Currently, this credit is limited to 65% under general regimes except for payments to tax treaty countries.
Investment and capital market incentives
To stimulate large-scale investment, the bill establishes a 25-year tax stability regime for domestic and foreign investors committing capital exceeding USD 50 million in Chile. This provides long-term certainty for major projects.
The proposal also eliminates the 10% tax on capital gains from the sale of listed securities, reversing changes made under Law No. 21,420 and treating such gains as non-taxable income once again.
Asset regularisation programs
The bill introduces a 12-month voluntary disclosure program allowing taxpayers to declare previously unreported foreign assets or income acquired before 1 January 2025. A 10% single tax applies to such disclosures, reduced to 7% if assets are repatriated to Chile and remain invested for at least five years.
Additionally, individuals and SMEs can regularise outstanding tax debts owed up to 31 December 2025, receiving 100% interest relief and 80% penalty relief for lump-sum payments, or up to 95% interest relief and 75% penalty relief under instalment arrangements.
A temporary 50% reduction in donation tax applies to donations made via public deed within one year of the law’s publication, provided they respect forced heirship allocations and do not exceed 75% of the donor’s assets.
Employment support and social measures
A progressive tax credit aims to protect formal employment for lower-income workers. Employees earning up to 7.8 monthly tax units (UTM) will receive a credit equal to 15% of their gross remuneration, gradually decreasing to zero as income reaches 12 UTM. However, the existing SENCE tax credit for training expenses will be eliminated.
The construction sector receives a boost through a temporary 12-month VAT exemption on new house sales and a new 5% tax rate on rental income from social housing properties (DFL 2) under 90 square metres.
The Chamber of Deputies will now review the bill before potentially sending it to the Senate for further consideration.
